The value journey taken by JPMorgan Chase’s
Mortgage Banking General Litigation Department
began as a story about managing volume. Over the
past six years, the number of new mortgage-related
lawsuits filed against Chase stemming from the
housing crisis exploded, from approximately 1,500
per year in 2007 to 13,500 per year in 2013—a
ninefold increase.

“We were looking at a huge inventory of cases,
increasing risk to the firm and mounting outside
counsel expenses,” says Matthew Biben, former
General Counsel of Chase Consumer and
Community Banking. “We had to create new
strategies to reduce risk and manage expenses.”
As so many other ACC Value Champions have done,
Biben and his team looked inward, seeking to leverage
and maximize the value of their internal resources.
They recognized that assigning every litigated matter
immediately to outside counsel was not the most
effective strategy. How could they better leverage the
expertise of in-house attorneys to maximize efficiency
and manage risk?

Combining an open dialogue with outside counsel,some strong in-house talent, and a complement ofseasoned contractors, the department designed a six-month pilot initiative staffed by one in-house attorneyand three contract attorneys. Led by KathleenO’Connor, Associate General Counsel and head ofthe Mortgage Banking General Litigation Departmentat Chase, the pilot team reviewed 470 cases filed intwo high-volume jurisdictions and retained 249 forpotential resolution. “Some were more successful thanothers, but it became clear that we were able to resolvea large number of cases quickly and more efficiently,”O’Connor says. Ultimately, 120 cases were resolvedand 77 were stayed so borrowers could be reviewed forloan modifications.

The pilot program yielded some key lessons. The
team quickly learned that many cases fit the criteria
for Early Dispute Resolution (EDR) and the
team was effective in resolving cases through loan
modification reviews. But the project was not without
its challenges. “There were a number of hurdles,”
O’Connor explains. “For example, some cases require
the exchange of discovery before they can be resolved
and are inappropriate for early resolution. The
procedural rules and timelines in certain jurisdictions
also make it difficult to resolve certain cases without
the assistance of local counsel.” Through effective case
triage, the EDR team quickly identified the case types
that could be resolved in-house and focused their
resources on the right mix of cases.

A full-featured initiative, the Early Dispute Resolution
Program, was rolled out in late 2012, staffed by a total
of eight attorneys. Its goals:

n reduce and improve the value of legal spend by
ensuring that cases are referred to outside counsel
only when necessary

n help control risk through early identification of
high-risk matters

n resolve matters using business solutions where
possible, such as loan modifications.

As to this last point, “Our team is customer-focused;
we’re trying to find resolutions. This is not a sea
change, but it was an opportunity to partner closely
with our business clients. Keeping people in their
homes is good for everyone,” O’Connor says.

The team reads every complaint and makes triage
decisions based on rigorous case analysis and their in-house expertise. “Our in house legal team is